Panaya Deal Clean, Infy Vic­tim of Ma­li­cious Ru­mours: Sikka

In­fosys CEO blames cur­rent con­tro­versy on “ma­li­cious­ness” of “Mon­day morn­ing quar­ter­backs”, de­nies for­mer CFO Bansal had raised red flags dur­ing Panaya deal

The Economic Times - - Front Page -

In any or­gan­i­sa­tion you would have dis­sent­ing voices. It is a good thing. You have a process, you deal with that dis­sent R SE­SHASAYEE Chair­man, In­fosys

Mum­bai: In­fosys CEO Vishal Sikka de­nied any wrong­do­ing in In­fosys’ $200-mil­lion ac­qui­si­tion of Panaya, and blamed the cur­rent con­tro­versy that the com­pany is em­broiled in on the “ma­li­cious­ness” of “Mon­day morn­ing quar­ter­backs”. “There is a lot of ir­re­spon­si­bil­ity and ma­li­cious­ness in what you see. You don’t ap­pre­ci­ate that... the peo­ple who are feed­ing the wrong sto­ries to the me­dia,” said Sikka, at pains to point out that he wasn’t re­fer­ring to the pro­mot­ers of the com­pany. “Lot of peo­ple, by­standers, the Mon­day morn­ing quar­ter­backs. It is a price you pay for be­ing at In­fosys. I try to not let it get to me. Life is too short,” he said. In Amer­i­can slang, a Mon­day morn­ing quar­ter­back is a per­son who crit­i­cises the ac­tions or de­ci­sions of oth­ers. Sikka de­nied that for­mer CFO Ra­jiv Bansal had raised red flags dur­ing the Panaya ac­qui­si­tion. On Mon­day, ET re­ported that Bansal had ex­pressed reser­va­tions about the Panaya deal, which led to him leaving the or­gan­i­sa­tion with a sev­er­ance pack­age of .₹ 17.38 crore, as re­ported in the 2015-16 annual re­port. The in­for­ma­tion that Panaya was the flash­point came from four in­de­pen­dent sources.

“There is noth­ing there. He was CFO at the time we went through the process. It was the first time we were do­ing it, so we were ex­tra care­ful,” said Sikka. “My view is that too big a deal has been made out of Ra­jiv Bansal’s sev­er­ance, David’s (Kennedy) sev­er­ance, my com­pen­sa­tion and Pu­nita’s (Ku­mar-Sinha) ap­point­ment.”

On the same ques­tion, In­fosys non-ex­ec­u­tive chair­man R Se­shasayee added: “In any or­gan­i­sa­tion you would have dis­sent­ing voices. It is a good thing.”

The mea­sures out­lined at the press con­fer­ence by the In­fosys chair­man were con­tested by for­mer chief fi­nan­cial of­fi­cer V Balakr­ish­nan, who said, “His (Ra­jiv Bansal’s) ser­vice was not ter­mi­nated but he re­signed on his own ac­cord­ing to the com­pany press re­lease, and he even served his no­tice pe­riod of three months. Then where is the ques­tion of sev­er­ance pay?” Balakr­ish­nan added that Se­shasayee’s “clar­i­fi­ca­tion raises more ques­tions”.

Murthy struck a pos­i­tive note in his as­sess­ment of the in­ten­tions of the com­pany’s board. “They are all good­in­ten­tioned peo­ple of high in­tegrity, but ob­vi­ously be­ing hu­man even good peo­ple some­times make mis­takes, this is one such case,” said Murthy.

“But good lead­er­ship de­mands that they lis­ten to all con­cerned share­hold­ers, re-eval­u­ate their de­ci­sion and take cor­rec­tive ac­tion. I hope they take cor­rec­tive ac­tion soon and im­prove gov­er­nance for a bet­ter fu­ture for the com­pany,” he said. The soft­ware giant em­ploys about 2 lakh tech­nol­ogy work­ers, and is de­pen­dent on the US, Europe and the rest of the world for about 97% of its rev­enues, and has 18-plus clients who con­trib­ute more than $100 mil­lion in rev­enue.

In an in­ter­view to ET pub­lished in its Fri­day edi­tion, Murthy de­manded a re­view of the role played by the spe­cial com­mit­tee on se­nior man­age­ment com­pen­sa­tion and sev­er­ance pay, as well as the board of the com­pany with re­gard to high sev­er­ance pay­outs. “Such pay­ments raise doubts whether the com­pany is us­ing such pay­ments as hush money to hide some­thing,” he had said in the in­ter­view.

The 2015-16 In­fosys annual re­port showed that In­fosys was to pay .₹ 17.38 crore to then CFO Ra­jiv Bansal, who quit in Oc­to­ber 2015, but con­tin­ued to serve as an ad­viser to the CEO and the board un­til De­cem­ber. In­fosys sub­se­quently ex­plained the pay­ment as part of an en­hanced non-com­pete.

In an in­ter­view to ET pub­lished in its Mon­day edi­tion, Se­shasayee said the amount ac­tu­ally paid was .₹ 5.2 crore and that “bal­ance pay­ments have been sus­pended since April 2016”.

For­mer In­fos­cion Balakr­ish­nan is of the view that other gov­er­nance is­sues have come to the fore be­cause of this is­sue (of the sev­er­ance pay­out to Ra­jiv Bansal). “If in­ves­ti­ga­tions have proved there was noth­ing wrong, then why stop?” he said. “Some­one has to own this up. The chair­man should take re­spon­si­bil­ity,” he added. Murthy had de­manded that the In­fosys board be re­cast with “some good peo­ple” like Marti Subrah­manyam and that it should also in­duct un­named for­mer In­fos­cions, “schooled in the In­fosys val­ues”.

“In­sti­tu­tional in­vestors have ac­cess to board and the CEO. Nor­mally they don’t go to the pub­lic and keep con­ver­sa­tions di­rect,” said Kavil Ra­machan­dran, ex­ec­u­tive direc­tor of ISBHy­der­abad’s Cen­tre for Fam­ily En­ter­prise, adding that in­sti­tu­tional share­hold­ers have much more at stake than founders whose col­lec­tive stake is just over 12%.

TV Ma­halingam & Megha Man­davia

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